Warburg Pincus, a global growth investor, has invested $200 million in The Fortegra Group LLC, the insurance subsidiary of Tiptree Inc. (NASDAQ:TIPT). The investment will give Warburg Pincus an approximate 24 percent ownership in Fortegra on a fully diluted basis. Fortegra is a specialty insurer, underwriting premiums and premium equivalents.
Tiptree’s executive chairman Michael Barnes said, “This investment accomplishes many of our strategic goals including raising capital to accelerate Fortegra’s growth and recapitalizing both companies balance sheets through the repayment of indebtedness.” Barnes continued, “We are excited to continue working with Rick and the Fortegra team as they execute on their long-term objectives, and we look forward to a strong partnership with Dan Zilberman and the Warburg Pincus team. They bring significant expertise across many sectors, including insurance, and will be great partners in support of Fortegra’s continued success.”
“Our objective has always been to build an insurance enterprise that generates exceptional returns for its investors by complementing underwriting results with fee revenue,” said Rick Kahlbaugh, chief executive officer of Fortegra. “This transaction represents the collaboration of industry experience, capital and investment acumen that will be the catalyst to accelerate Fortegra’s growth as a global specialty insurer. Joining forces with Warburg Pincus is yet another chapter in the Fortegra story and together Fortegra, Tiptree and Warburg Pincus will accelerate the exceptional growth and profitability of Fortegra.”
“Fortegra’s talented management team has built a world-class specialty insurance platform delivering high quality products and services to its customers worldwide,” said Dan Zilberman, managing director and Head of Special Situations, Warburg Pincus. “We are excited to partner with Rick Kahlbaugh and Tiptree’s experienced management team and are committed to Fortegra’s continued growth and long-term success. Our investment in Fortegra underscores our commitment to partnering with innovative companies in the insurance sector. We look forward to supporting Fortegra as they continue to expand their capabilities,” added Jeff Stein, Managing Director, Warburg Pincus.
Barclays acted as exclusive financial advisor and Ropes & Gray LLP and Sidley Austin LLP provided legal counsel to Tiptree and Fortegra. BofA Securities acted as exclusive financial advisor and Willkie Farr & Gallagher LLP provided legal counsel to Warburg Pincus.